Deck 4: Managing in a Global Environment

Question 1

Managers with a polycentric attitude would view every foreign operation as difficult and hard to understand.

Answer 1

True

Question 2

The GCC refers to the Gulf Coordination Committee

Answer 2

False

Question 3

The Council of Arab Economic Unity (CAEU) was established by Egypt, Saudi Arabia, Qatar, and Oman in 1972.

Answer 3

False

Question 4

The transnational corporation characterizes the ethnocentric attitude toward the management of an organization's global business.

Question 5

GAFTA refers to the Greater Association of Free Trade for Arabs.

Question 6

A drawback of the geocentric perspective is that it is inflexible.

Question 7

Yemen is part of the GCC.

Question 8

In the early stages of doing business internationally, managers may license or franchise to another firm the right to use their organization's brand name, technology, or product specifications.

Question 9

When organizations first go international, they often start with global sourcing.

Question 10

Multinational corporations maintain significant operations in two or more countries simultaneously, but are based in one home country.

Question 11

The primary motivation for the creation of the EU was to allow Europeans to reassert their position against the industrial strength of the United States and Japan.

Question 12

The process of exporting involves acquiring products made abroad and selling them domestically.

Question 13

Americans tend to suffer from parochialism.

Question 14

Transnational corporations run their businesses from their home country.

Question 15

The three original partners of NAFTA are the United States, Canada, and Mexico.

Question 16

Multinational corporations became commonplace in the mid- 1960s.

Question 17

The polycentric attitude is a world- oriented view focusing on using the best approaches and people from around the globe.

Question 18

The European Union (EU) and the North American Free Trade Agreement (NAFTA) created regional trading and cooperative agreements.

Question 19

Managers with an ethnocentric attitude would not trust foreign employees with key decisions or technology.

Question 20

Norway is a member of the European Union.

Question 21

Which of the following is the least favorable attitude for a manager who wishes to be successful in international business?

A) ethnocentric
B) polycentric
C) multicentric
D) multicultural

Question 22

Arab countries rank extremely high on uncertainty avoidance.

Question 23

One reason for parochialism in the United States is that Americans tend to study in school.

A) English and Spanish
B) English and French
C) only English
D) only two languages

Question 24

The legal- political environment is an important factor of managing in a foreign environment.

Question 25

Mexico is an example of a collectivist nation.

Question 26

Ethnocentric views concentrate on their .

A) world orientation
B) home country
C) host country
D) racial orientation

Question 27

One challenge that arises out of the openness of globalization is the threat of terrorism.

Question 28

Licensing is commonly used by both manufacturing and services organizations.

Question 29

An increased level of anxiety among its people characterizes a society with high uncertainty avoidance.

Question 30

The GLOBE framework for assessing cultures is similar to Hofstede's framework, but measures fewer dimensions.

Question 31

GLOBE stands for Global Leadership and Organizational Behavior Effectiveness.

Question 32

Hofstede found that the Italian culture is well above average on uncertainty avoidance measures of culture.

Question 33

In a strategic alliance, both partners share the risks and rewards of the alliance.

Question 34

The United States is an example of a country with smaller power distance.

Question 35

Which of the following describes the use of language in the Arab World?

A) Besides Arabic, French and English are widely spoken in many Arab countries.
B) Besides Arabic, the Armenian language is the second spoken language in Lebanon.
C) Arabic is the only spoken language in most Arab countries.
D) Because of colonization, French is widely spoken in Bahrain.

Question 36

Successful global management requires an attitude that is best described as _ .

A) geocentric
B) parochial
C) polycentric
D) ethnocentric

Question 37

Managers with a(n) _ attitude view every foreign operation as different and hard to understand.

A) ethnocentric
B) geocentric
C) polycentric
D) transnational

Question 38

Research indicates that organizational culture has a stronger impact on employees than does national culture.

Question 39

Parochialism is .

A) recognition of diverse religious beliefs
B) a tendency to view the world through a single perspective
C) a desire to leave one's own culture for a foreign culture
D) acceptance of diverse points of view

Question 40

Only when a country's legal- political environment is unstable or revolutionary is it of concern to managers.

Question 41

The was created by the unification of 12 countries in Europe.

A) European Union
B) Western European Alliance
C) Trans- European Market (TEM)
D) European Common Market

Question 42

The principle reason for the formation of a regional trading alliance in Europe was to reassert members' economic positions against the strength of the United States and .

A) Mexico
B) Japan
C) Canada
D) Russia

Question 43

The single EU currency is called the .

A) franc- mark
B) pound
C) franc
D) euro

Question 44

The Gulf Cooperation Council does not include .

A) Kuwait
B) Yemen
C) Saudi Arabia
D) The UAE

Question 45

The Association of Southeast Asian Nations includes _.

A) a membership of 10 Southeast Asian nations
B) the members of NAFTA and CAFTA
C) the members of the European Union and India
D) none of the above

Question 46

How many member nations belong to the African Union (AU)?

A) 67
B) 53
C) 46
D) 62

Question 47

CAEU refers to _.

A) Congress of Arab Economic Union
B) Council of Arab Economic Unity
C) Committee of Arab Economic Unity
D) Congress of Arab Economic Unity

Question 48

A(n) attitude is characterized by parochialism.

A) polylinguistic
B) acculturated
C) ethnocentric
D) geocentric

Question 49

Nepal belongs to which of the following regional trade alliances?

A) ASEAN
B) SAARC
C) EU
D) AU

Question 50

The North American Free Trade Agreement eliminated all of the following except .

A) China's role as a U.S. trading partner
B) the need for import licensing
C) tariffs on traded commodities
D) customs user fees

Question 51

A(n) attitude is the view that host- country managers know the best practices for running their operations.

A) international
B) ethnocentric
C) polycentric
D) geocentric

Question 52

GAFTA refers to .

A) The Gulf Arab Free Trade Area
B) The Gulf Association for Free Trade Agreement
C) The General Arab Free Trade Area
D) The Greater Arab Free Trade Area

Question 53

The World Trade Organization evolved from which of the following?

A) Mercosur
B) UNIDIR
C) Marshall Plan
D) GATT

Question 54

The geocentric attitude is a view.

A) culture- bound
B) nationalistic
C) world- oriented
D) franchise- based

Question 55

The North American Free Trade Agreement includes .

A) the United States, Canada, and Honduras
B) Columbia, Mexico, and the United Sates
C) Mexico, Canada, and the United States
D) Canada, Mexico, and Brazil

Question 56

The World Trade Organization is centered around which of the following?

A) peace treaties
B) economic sanctions
C) trade agreements
D) public protests

Question 57

The Council of Arab Economic Unity was established in

A) 1967
B) 1977
C) 1947
D) 1957

Question 58

The European Union covers .

A) nationalistic policies and travel
B) border controls, taxes, and subsidies
C) employment, investment, and trade
D) all of the above

Question 59

Which of the following countries is not a member of the European Union?

A) Cyprus
B) Iceland
C) Slovenia
D) Ireland

Question 60

Among the member countries of the North American Free Trade Agreement, trade has since the treaty was signed.

A) decreased
B) decreased initially, but increased steadily
C) increased in commodities, but decreased in manufactured goods
D) increased

Question 61

Multidomestic corporations are known for .

A) ethnocentric attitudes
B) multicentric attitudes
C) polycentric attitudes
D) having their holdings in one country

Question 62

Which of the following is a basic definition of a multinational corporation?

A) a company that maintains operations in multiple countries
B) a company that pays corporate taxes in at least two countries
C) a company that has multiple home bases and manufacturing plants
D) a company that maintains franchises in multiple countries

Question 63

Which of the following types of global organizations reflects the geocentric attitude?

A) regional organization
B) multidomestic corporation
C) transnational organization
D) global company

Question 64

Joint ventures are a type of .

A) strategic alliance
B) license
C) foreign subsidiary
D) franchise

Question 65

Franchising is primarily used by .

A) manufacturing organizations
B) legal organizations
C) service organizations
D) political organizations

Question 66

An international company is most likely to develop foreign subsidiaries .

A) before it develops franchising agreements
B) after it establishes strategic alliances
C) before it develops licensing agreements
D) before it begins importing and exporting

Question 67

International businesses have been around since about what date?

A) the twentieth century
B) the seventeenth century
C) the nineteenth century
D) the fifteenth century

Question 68

Transnational organizations are also known as .

A) multidomestic organization
B) polycentric organizations
C) borderless organizations
D) ethnocentric organizations

Question 69

Multinational corporations (MNCs) have only become commonplace since approximately what date?

A) 1945
B) mid- 1960s
C) mid- 1970s
D) mid- 1980s

Question 70

Which of the following is the basic difference between multidomestic corporations and global companies?

A) Multidomestic corporations decentralize management to the local country, while global companies centralize management in the home country.
B) Multidomestic corporations pay more in taxes than global companies do.
C) Multidomestic corporations typically do business with more countries than global companies do.
D) Multidomestic corporations are run by global companies but must be owned by a local, national company.

Question 71

In an attempt to be more aggressive, a company might export and import more. These steps usually require .

A) abnormal operations for a geocentric organization
B) conducting business in a polycentric manner
C) the establishment of strategic alliances
D) minimal investment and minimal risk

Question 72

When an organization drops its structure based on countries and reorganizes according to industries, it is pursuing a global organizational operation known as .

A) ethnocentrism
B) multinational organization
C) polycentrism
D) borderless organization

Question 73

Importing and exporting represent a more significant global investment than which of the following?

A) franchising
B) global sourcing
C) licensing
D) strategic alliance

Question 74

The process of making products domestically and selling them abroad is known as _ _.

A) exporting
B) joint ventures
C) importing
D) franchising

Question 75

In the later stages of doing business globally, if an organization is ready to make a more direct investment, it might utilize .

A) joint ventures
B) foreign subsidiaries
C) strategic alliances
D) all of the above

Question 76

Which of the following is an MNC that tailors marketing strategies to the host country's unique characteristics?

A) global company
B) borderless organization
C) multidomestic corporation
D) transnational organization

Question 77

Which of the following is usually found in the final stage of an organization's global evolution?

A) cross- culturally training its managers
B) exporting its products to other countries
C) establishing strategic alliances with partners
D) licensing another firm to use its brand name

Question 78

Which of the following is not a feature of a multidomestic corporation?

A) Marketing strategies are tailored to each country's culture.
B) Decision making takes place at the local level.
C) Nationals are typically hired to run operations in each country.
D) Products are manufactured only in the local country.

Question 79

Transnational organizations are focused on .

A) increasing efficiency
B) reinforcing structural divisions
C) developing INVs
D) all of the above

Question 80

Multidomestic corporations .

A) utilize decentralization to make decisions in management in local countries
B) follow the tastes, preferences, and values of the home country
C) utilize ethnocentric attitudes in financial decisions, but favor polycentric views in human resources issues
D) maintain operations in multiple counties, but do not allow managers in each country to make their own decisions